The need for new infrastructure, including pipes and water meters, will almost certainly drive water rates up in Mancos.

"We need to do this. We don't have a choice," said Mayor Pro Tem Perry Lewis at Wednesday's board meeting.

The town is losing 20 to 30 percent its treated water after it leaves the plant because of leaky, aging pipes and water meters that aren't reading as accurately as possible.

"We're spending electricity and much needing resources and losing it somewhere along the lines, literally," said Mayor Rachel Simbeck.

The rate of the increase has yet to be determined.

The board of trustees considered the possibility of slowly phasing in higher monthly rates until they reached $41 in 2018, at the recommendation of Gabe Preston, a managing partner of RPI Consulting. These rate increases could be phased in starting at $5 in the first year and tapering off to $2.50 a year for four years. The town could also choose to raise rates by $3 a year, for five years. In 2018, the rates would be reassessed.

At the same time, Preston recommended lowering the gallons allowed per residence to 7,000 from 10,000 while increasing the overage charges from $1 to $2 per 1,000> gallons. The current monthly water rate is $25.72.

These increases would pay for the town's needed infrastructure improvements, which are estimated to cost about $3 million, according to the town's budget. These improvements range from 9,000 feet of water lines to the new water tank. In order to take out a loan to pay for improvements, the board must show the Colorado Department of Local Affairs the town has rising revenue, Preston said.

"If you were to raise it more at the beginning, it's going to give you more borrowing power," he said.

Trustee Queenie Barz said people needed to be aware that during the summer months the rate increases would amount to more than a few dollars if they used more than the allotted amount of water. She asked Preston to provide the board with estimates of how much water bills could go up based on average water use, especially during the summer. She said she wanted people to understand the increases could be substantial based on their use.

"I'm going to have sticker-shock in the summertime with my lawn if I want to keep my green lawn, but that's something I may have to think about," she said.

Preston also presented a breakdown of water rates and allotments in nearby towns. Mancos has been allotting more water at a lower rate, but it is not sustainable, Preston said.

"There is all this overhead that has to be split between a smaller number of customers," Preston said.